The series of Stop Orders announced by the CVM (Brazilian Securities and Exchange Commission) in Brazil continues. This time, the autarchy, linked to the Ministry of Economy, warns of irregular performance in the market of the broker FG Markets, which operates in the Forex segment.
FG Markets is the fantasy name in Brazil of Glastrox Trade Ltd, an international conglomerate dedicated to the practice of Forex. According to the company's website, it was founded in 2014 by a group of professional investors, investment managers and software engineers.
Sought by the report to comment on the Stop Order, FG Markets did not comment until the publication of this text.
Headquartered in tax havens
Also according to the website, the company is registered in the Marshall Islands, an archipelago located in Oceania. However, the physical seat is mentioned in the city of Nicosia, capital of Cyprus – a European island close to Turkey. Both are considered “tax havens”, regions or countries that offer a series of very attractive tax conditions, mainly for foreign citizens.
There is no mention on the website regarding specific company contacts for the Brazilian public, although it promises service in several languages. The available channels are a support email and a telephone number with Australia's IDD. Payments, in turn, are processed by a subsidiary based in the Cypriot city of Limassol.
There is also a section on the company's website dedicated to the issue of risk involving speculative activities. “FGMarkets is not acting as a consultant or serving as a fiduciary for the client”, highlights part of the text about the negotiations.
There is also a warning that the company does not open accounts for residents in the United States, Canada, Israel and European Union countries.
Serial Stop Orders
With the new CVM announcement, there are already ten orders to suspend offers in just over a month. Eight of them were due to irregular offers involving Forex.
The series began on April 23, with the suspension against IQ Option. This company, however, chose to face the CVM's decision and continues with both the offer of investments and the placement of advertising, including through ads on Google and Gmail.
Start Invest, Tradear, Ava Trade, CIB FX, Pepperstone Group and Paladin FX were also punished.
The stop order against these companies does not mean that the Forex market is prohibited in Brazil.
The so-called “derivative contract in exchange for foreign currency pairs” is shaped by what Law 6,385 / 76 calls “other derivative contracts, regardless of the underlying assets”, which is security.
In a booklet on Forex, the CVM recognizes that elements such as the internet facilitate the approach of the Brazilian investor with agents abroad. However, he emphasizes that the formats to be offered in Brazil must follow the rules provided for in Brazilian law and regulation.
The problem is that in order to operate in this market, the interested company must first seek the CVM and seek either the registration or the dismissal of it. Otherwise, the offer of this type of investment will be illegal and the company will run the risk of receiving a Stop Order.
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This source of this article is portaldobitcoin.com.